This may old news but StarFish Oil and Gas made a discovery in...

This may old news but StarFish Oil and Gas made a discovery in the Reconcavo basin in March 08 in block Rec-T-192, 20 kilometres due south of Block 138.

Initial flow rates were 330 barrels per day. I haven't been able to get much more on the follow up flow testing because their website is very ordinary.

here's the link the announcement.

http://www.bnamericas.com/news/oilandgas/Starfish,_Somoil_hit_oil_in_Reconcavo_basin

Running through each of their announcements and then translating them from Portuguese into English, I think they have had 5 discoveries from 5 wells, all in the Reconcavo and Sergipe Alagoas basins, the same basins as our Block 430 and Block 138 and 59.

This is a very good omen for ERH. The flow rates may be modest but with very affordable development plans of which ERH only has to contribute either 40 % or 50% depending on the basin, it wouldn't be too hard to get the daily production up to 5,000 barrels per day in a reasonable period of time.

I think at 11 cents and a 3 to 5 year time horizon, an investor with the kahounas to hang in there for that period of time, one could expect a share price in the multiple $'s. That could mean anything from 10 to 50 bagger from current share prices.

The key now is the development plans that the company comes up with and then getting these into the ANP for approval and then to our financiers. I think it's fair to say that the recent trip to New York has highlighted that there are plenty of people with the cash to help the company with the development funding.

For me personally, the company's development plans are key. I personally think the the oil price will rebound quite strongly. It won't be unreasonable to see the oil price back to USD$50 in the near term, it's already back to USD$40.

If the company makes a discovery at Block 138 and/or Block 59 ( with the announcments from StarFish Oil and Gas above, probability is quite high )and we get the 1,000's of barrels per day as per their expectations ( as presented at the AGM and the presentation in New York ), then this will be a whole new ball game. 10 wells down and ERH could be looking at 10,000 to 30,000 barrels per day in quite a short period of time for up to 6 years. CEO says that intial production from these wells cold flow at 3,000 to 4,000 barrels per day.

That's a lot of cash.

I think the company's future is already set with the discoveries at Block 330 and Block 430, these current wells in the Reconcavo Basin could be the cream. Now it's a patience game. If you have it, you could be rewarded.

As I said before, so long as the company's sticks with the development plans and timelines, I am going to be a long term shareholder in ERH.

Update due tomorrow and from the progress we got last week, about 700 metres in the week, we should be about 1,500 metres down.

Regards

Kojasper